Wal-Mart Bribery Probe Expands to Brazil and China, Congressmen Say

Wal-Mart's probe of bribery allegations in its Mexican subsidiary has expanded to its businesses in China and Brazil, two congressmen say.

Last month, the world's largest retailer disclosed that it was expanding its probe beyond Mexico to include other countries, but it didn't identify them.

Democratic congressmen Elijah Cummings of Maryland and Henry Waxman of California say that lawyers for Wal-Mart told them that they were hired to review anti-corruption policies and operations in Brazil and China as well as Mexico. They say the lawyers recommended that Wal-Mart also review its operations in India and South Africa.

An email to a Wal-Mart spokesman was not immediately returned.

The New York Times reported in late April that Wal-Mart's Mexican unit allegedly paid millions of dollars in bribes to speed building permits and gain other favors. The Times said executives didn't notify authorities.

Wal-Mart's growth in Mexico has been so rapid that one of every five Wal-Mart stores now is in that country. It is Mexico's largest private employer, with 209,000 employees there.

The newspaper said that only after learning of its investigation did Wal-Mart inform the U.S. Justice Department in December 2011 that it had begun an internal investigation into possible violations of the Foreign Corrupt Practices Act. Under that law, it is illegal for U.S. corporations and their subsidiaries to bribe foreign officials.

The Times said its investigation uncovered a lengthy struggle at the highest levels of Wal-Mart, pitting the company's commitment to high moral and ethical standards against its relentless pursuit of growth.

Wal-Mart had sent investigators to Mexico City, where the newspaper report said they quickly discovered evidence that included a paper trail of hundreds of suspect payments totaling more than $24 million.

But according to the Times, top Wal-Mart executives kept quiet about the campaign and were more focused on damage control than on exposing the corruption. Then-CEO H. Lee Scott Jr. reportedly rebuked internal investigators at one meeting for being overly aggressive. Shortly thereafter, the newspaper said, the investigation was turned over to the general counsel for Wal-Mart de Mexico, who himself was alleged to have authorized bribes. He swiftly exonerated his fellow executives.